Summary: For more than a decade, public and private bus companies have debated their roles in meeting the demand for local charter service in the United States. Public transit operators view their services as essential to local community groups who cannot obtain services from private operators; private operators counter that charter service should fall primarily in their domain. Congress has prohibited public transit operators from engaging in charter bus operations except as permitted by the Department of Transportation. This report assesses (1) the extent to which the federal charter service regulation allows communities to cost-effectively and efficiently meet the transportation needs of government, civic, and charitable groups; (2) the extent to which public transit operators and private charter operators have entered into charter service agreements; and (3) the extent to which contracts enable private operators to profit from the provision of charter service by public operators using federally subsidized vehicles.
